This Report's primary goal is to study the forwarding process of exported flammable solids products (FCL) at Da Nang Port Joint Stock Company, examine the rules and specifications pertaining to the forwarding of full container load shipments for export at Vietnam seaports, with a particular emphasis on flammable solids products from the standpoint of Da Nang seaport. The Report's second goal is to outline the steps and paperwork needed to export flammable solids products and evaluate strengthen and weakness of the process company using. Third, giving suitable suggestions after assessing to boost company efficiency and make the Da Nang Port a more welcoming place for consumers to conduct business. Scope: Place: Da Nang Port Joint Stock Company Time: From 01/01/2024 to 01/05/2024 This report is conducted with an aim to study and analyze the forwarding process of exported flammable solids products (FCL) at Da Nang Port Joint Stock Company. The time-carrying-on this report is from 1st January to 1st May in 2024. Report-supported data and information is collected between 2021 and 2023.
THEORETICAL OVERVIEW ABOUT FORWARDING PROCESS
Process overview
According to ISO 9000:2015 - Quality Management Systems - Fundamentals and Vocabulary: A process is a set of interrelated or interacting activities, which transforms inputs into outputs
Business Process Management (BPM) frameworks define a process as a sequence of interconnected activities that transform inputs into valuable outputs, aimed at fulfilling specific business objectives or customer needs These processes are structured to be repeatable, measurable, and subject to improvement, featuring well-defined boundaries, inputs, outputs, and controls.
A process must include 6 components below:
(2) A main performance who oversees coordinating all the variables and has responsibility of the process
(3) Indicators, measurable and appropriate for the process
(4) Should be divisible into subprocesses
Personnel play a crucial role in connecting various areas of a business, whether horizontally or vertically, as outlined in the company’s organizational chart This connection is essential for emphasizing the importance of streamlined processes within the organization.
(6) A process should have a procedure defining and establishing the way the activities of the process must be done
(7) Every process must be audited to ensure its proper function, control, and improvement There isn’t enough maturity in the organizations to operate without audits
In "Fundamentals of Business Process Management," co-author Marlon Dumas identifies four key aspects of process performance measures: time, cost, quality, and flexibility These elements are essential for evaluating the efficiency and effectiveness of business processes.
Cycle time is a crucial metric for assessing process performance, defined as the total time taken to complete a single case from start to finish When evaluating cycle time, two essential components must be considered.
• Processing time (also called service time): the time that resources, such as process participants or software applications invoked by the process, spend on handling the case
Waiting time refers to the duration a case remains idle, encompassing both queueing time—when resources are unavailable to address the case—and additional waiting periods, such as those required for synchronization with other processes, activities, or when awaiting input from customers or external parties.
(2) Cost: Beside time, cost is also another common performance dimension when analyzing and redesigning a business process has a financial nature There are different perspectives on cost
Fixed costs are overhead expenses that remain relatively stable regardless of processing intensity These costs typically arise from infrastructure utilization and the maintenance of software systems.
• Variable costs are positively correlated with some variable quantity, such as the level of sales, the number of purchased goods, the number of new hires
The quality of a business process can be evaluated from two key perspectives: the client's viewpoint and the perspective of the process participants, highlighting the distinction between external and internal quality External quality refers to client satisfaction with the product or process, which is determined by how well the delivered product aligns with the client's specifications and expectations.
Flexibility is often overlooked as a key criterion for assessing the impact of business process reform It refers to the capacity of a business process to adapt to changes, which can influence various components of the process.
• The ability of resources to execute different tasks within a business process setting;
• The ability of a business process as a whole to handle various cases and changing workloads;
• The ability of the management to change the structure and allocation rules;
• The organization’s ability to change the structure and responsiveness of the business process to wishes of the market and business partners
A different view for evaluating process performance was established by Kaplan and Norton in their research called ‘The Balanced Scorecard Links Performance Measures’ stating four basic questions:
• How do customers see us? (customer perspective)
• What must we excel at? (internal perspective)
• Can we continue to improve and create value? (innovation and learning perspective)
• How do we look to shareholders? (financial perspective)
The balanced scorecard minimizes information overload by focusing on a limited number of key measurements, encouraging managers to prioritize the most critical metrics It also offers senior managers insights from four different perspectives, enhancing strategic decision-making.
1.1.4 Overview about forwarding process of exported FCL shipment:
- Step 1: Logistics company or cargo owner request Booking note from carrier or carrier’s agents
- Step 2: Handle Booking note to carrier’s office and request Empty release order (carrier’s office normally located at port) Carrier will provide seal and packing list container for customers
- Step 3: Customers come to the Port to complete container delivery procedures and, handle booking note and empty release order, then pay service fees in cash
- Step 4: Sent vehicle to port picking up the container to the warehouse for packing
- Step 5: Deliver packaged- container to port and make custom declaration
In the logistics process, the primary responsibilities lie with the logistics companies and cargo owners, while carriers and ports play supportive roles Customers hold the main responsibility for evaluating the performance of this process, emphasizing the importance of time and cost to prevent supply chain interruptions Quality remains a critical factor in business, as customer satisfaction directly impacts revenue Moreover, processes must adapt to various scenarios, products, and purposes, highlighting the need for flexibility To effectively assess these processes, the evaluation criteria developed by Professor Dumas will be utilized for their relevance and suitability.
To enhance the efficiency of the exporting process, customers must obtain documentation from carriers, ports, and customs officials, which often leads to delays due to manual handling and reliance on staff experience The processing and waiting times are significantly influenced by the facilities and the skill level of employees at the port To streamline this process, it is essential that these procedures are completed within 2 to 3 minutes, leveraging technology and ensuring that professional staff possess the necessary expertise to manage export documentation and accurately calculate service fees promptly.
The cost of processing export activities significantly impacts companies, as it encompasses various expenses associated with preparing export documents Specifically, transportation costs between facilities such as ports, carrier offices, and warehouses contribute to overall expenses for customers Additionally, inaccuracies or missing information due to excessive paperwork can lead to further costs, as staff struggle to manage the workflow efficiently.
The recent influx of incoming and outgoing shipments at the port has caused temporary delays for some special cargo, resulting in reimbursement losses for the port To reduce these variable costs, it is essential to modernize steps 1, 2, and 3 by implementing an automated system that allows customers to manage processes from their offices, eliminating the need for direct interaction at the port.
To ensure the overall quality of a service process, it is essential to gather feedback from both customers and staff, who are the primary users Their satisfaction can be measured through positive responses, emotional feedback, the percentage of negative answers, and the overall customer life cycle.
(4) Flexibility: A process is able apply in difference situations and changes in working environment.
Seaport overview
According to Clause 1, Article 73 of the Viet Nam Marine Code 2015, a seaport is defined as a designated area that encompasses both land and water, equipped with the necessary infrastructure and facilities for the efficient loading and unloading of goods, as well as the embarkation and disembarkation of passengers A seaport may consist of one or two port terminals, each of which can contain multiple wharves to support various maritime operations.
Additionally, the 2015 Viet Nam Marine Code's Article 74 specifies requirements for identifying a seaport in:
- Have a water area thoroughly connecting to a sea
The region boasts natural geographical features that are ideal for the construction of wharves, port terminals, anchorage areas, transshipment zones, and navigational channels, ensuring safe entry, exit, and operation of ships.
- Have advantages in marine transportation
- Act as the center of the traffic network to facilitate inland freight transport, carriage and transshipment of exporting and importing goods by sea
In the context of the United Nations Conference on Trade and Development (UNCTAD), a seaport is defined as a facility situated along coastlines or navigable waterways that serves as a crucial point for the departure, arrival, transshipment, or storage of maritime cargo and passengers These seaports play a vital role in global trade and transportation networks, enabling the efficient movement of goods and people between land and sea They are equipped with essential infrastructure, including docks, piers, wharves, berths, warehouses, and terminal facilities, along with the necessary equipment for loading and unloading vessels, handling cargo, and offering services to ships and their crews.
According to Article 76 - Viet Nam Marine Code 2015, seaport:
- Provide vessel traffic services for ships which enter and leave a seaport
- Provide transports, equipment, and workforce necessary for ships to anchor, load or discharge goods and embark or disembark passengers
- Provide freight transportation, loading, discharge, warehousing, and storage services within the territory of a seaport
- Play its role as the center to help different traffic networks outside of the seaport to get connected
The International Maritime Organization (IMO) acknowledges the crucial role of seaports in facilitating maritime commerce, ensuring safe vessel movement, and fostering sustainable development As key operational hubs, seaports are integral to cargo handling and passenger transport, significantly enhancing the efficiency of global trade and transportation networks.
Andrzej Montwill from the Maritime University of Szczecin explores the role of seaports as logistical hubs, highlighting their evolution from local delivery systems to vital components of the global economy Seaports now function as information centers for supply chain networks and distribution centers, enabling the optimization of transport and distribution processes This transformation facilitates the efficient scheduling of supplies to urban clients, ultimately enhancing logistical efficiency.
10 transportation and synchronizing order deliveries to specific users of the urban transportation system, such efforts alleviate congestion in urban areas
Article 3 of Decree 76/2021/ND-CP outlines the criteria for categorizing and assessing seaports in Vietnam, focusing on factors such as the influence area and size of the seaports.
The criteria for determining the influence area of seaports are based on the master development plan approved by the relevant state authority These criteria encompass various factors essential for assessing the operational and strategic impact of seaports in their designated regions.
Seaports play a crucial role in nationwide and inter-regional socio-economic development, functioning as vital international transit and gateway ports These ports are essential for enhancing trade and connectivity, supporting economic growth, and facilitating the movement of goods across borders Their strategic importance lies in their ability to serve both local and global markets, making them indispensable for regional development.
(c) Seaports that serve the purposes of regional socio-economic development;
(d) Seaports that serve the purposes of local socio-economic development
Criteria for the size of seaports are measured on the basis of the throughput of cargos and the tonnage of ship received at seaports, including the followings:
(b) Tonnage of ships received at seaports.
Flammable solids products
Flammable solids fall under Class 4 of the nine categories of dangerous goods, which are defined by the Federal Aviation Administration (FAA) as substances that can pose significant risks to health, safety, and property during transportation Recognizing these hazardous materials is crucial for minimizing associated risks through effective packaging, communication, handling, and stowage practices.
This is an important aspect of cargo safety These items may pose a risk to infrastructure, public health, and safety, if they are not appropriately regulated
The Occupational Safety and Health Administration (OSHA) Laboratory Standard defines a flammable solid as a solid material, excluding blasting agents or explosives, that can ignite and cause fire due to factors such as friction, moisture absorption, spontaneous chemical reactions, or retained heat from production processes Once ignited, these solids burn intensely and persistently, posing significant hazards.
Classification as flammable solids is determined by Australian Dangerous Goods Codes into three further subclasses, which are:
Subclass 4.1: Flammable solids that have self-reactive and desensitized explosive properties
Easily combustible solids can pose a fire risk during transport, particularly solid desensitized explosives that may detonate if not properly diluted Self-reactive substances are thermally unstable and can undergo exothermic decomposition without oxygen Additionally, explosives may be rendered less hazardous through moisture or the inclusion of plasticizing agents This category can include processed metals, potassium, lighters, and matches, all of which require careful handling to prevent accidents.
Spontaneously combustible materials, known as pyrophoric substances, can ignite within five minutes of exposure to air, even in small quantities These include various mixtures and solutions, both liquid and solid In contrast, self-heating substances require larger quantities and prolonged exposure to air to ignite, typically over hours or days Common examples include copra and phosphorus Besides the danger of spontaneous combustion, many of these chemicals pose additional risks.
Flammable liquids can pose significant risks, especially if they are accidentally knocked off shelves, leading to spontaneous ignition and potential fires It is crucial to exercise extreme caution when handling spontaneously combustible compounds to ensure safety.
Subclass 4.3: Substances which, in contact with water, emit flammable gases
Certain substances react with water to generate flammable gases that can create explosive mixtures with air, making them hazardous when wet These materials can be ignited by standard spark sources and include sodium, calcium, zinc powder, metal powders, alkali metals, activated carbon, aluminum phosphide, sodium batteries, and by-products from aluminum production.
There are some more familiar examples for substance belong to dangerous good class 4 in our daily life:
Substances Subclass Substance form in daily life
Aluminum power 4.1 paints and varnishes in model making production
Coal 4.2 vegetable based barbecue charcoal like wood charcoal
Phosphorus 4.2 in crop protection products
Table 1-1 Packing and labelling instruction on flammable solids products:
The widespread use of chemicals and hazardous products in both workplaces and homes poses significant risks to human health and the environment Implementing strict packaging requirements and regulations for these substances is essential to mitigate potential dangers and protect public safety.
Flammable solids are classified as dangerous products, necessitating compliance with specific packaging regulations As outlined in Article 6 of Decree No 34/2024/ND-CP, which governs the classification and transportation of dangerous goods, these regulations ensure safety and proper handling during transport.
In Vietnam, the packaging and containers used for dangerous products must adhere to the National Technical Regulation (QCVN), National Standards (TCVN), or specific decrees applicable to each category of hazardous materials Compliance with these regulations is essential for ensuring safety and proper handling of dangerous goods.
In the absence of national standards or regulations from the Ministry of Industry and Trade, specific requirements must be adhered to for the packaging and containers of dangerous goods These include ensuring that packaging can withstand impacts during transport, loading, and unloading, while preventing leakage of harmful substances despite vibrations, temperature changes, humidity, and pressure fluctuations The external surfaces must remain clean and free from hazardous chemicals, and any parts of the packaging that come into contact with dangerous substances must not be compromised in quality or integrity Additionally, containers for liquid hazardous materials must be designed to prevent spills or deformation due to volume increases from temperature changes and must tolerate internal pressure during transit, with leakage levels verified before leaving production facilities.
When packaging fragile products like glass and ceramics, it is essential to securely seal them within a sturdy outer box, using adequate cushioning and shock-absorbing materials For volatile substances, packaging must adhere to the manufacturer's specifications to prevent evaporation during transit Additionally, when handling dangerous goods in granular or powder form, it is crucial to ensure that they remain contained and do not disperse during loading, unloading, and transportation.
According to Article 7 of the Decree, all packages or containers containing hazardous materials must display a danger label that complies with government regulations This includes the use of dangerous symbols, warning signals, and danger signals, which must be affixed to the exterior of the containers in a clearly visible location.
Figure 1-1 Labels for 3 subclasses of flammable solids
The packing instruction group for Class 4 materials is detailed in the appendix of this report Packing groups for subclasses 4.1, 4.2, and 4.3 are determined based on test results obtained from the UN Manual of Tests and Criteria.
Packing group I: self- igniting or violent reaction
Packing group II: self-heating or slight reaction
Packing group III: less self-heating or slow reaction
Transporting hazardous materials requires strict safety precautions and professional expertise, particularly when vehicles and drivers are involved Although this is an export procedure, the shipment will travel by road from the customer's warehouse to Da Nang Port, necessitating adherence to Vietnam's regulations Specifically, Decree No 42/2020/ND-CP outlines the requirements for transporting dangerous goods by land motor vehicles, ensuring that all participants meet legal traffic norms.
- Drivers of vehicles transporting dangerous products must be trained and authorized a certificate of completing specific training programs as stipulated
Warehouse personnel, escorts, and those involved in the loading and unloading of hazardous materials are required to undergo specialized training programs Upon completion, they must obtain certification that authorizes them to handle specific types of dangerous goods safely during transportation, storage, and handling processes.
DA NANG PORT JOINT STOCK COMPANY OVERVIEW
General information
Figure 2-1 Da Nang Port joint stock company 's logo (Source: https://danangport.com/)
• Name: Da Nang Port Joint Stock Company
• Charter capital as per the Enterprise Registration Certificate: 990,000,000,000 VND
• Corporate address: 26 Bach Dang, Thach Thang Ward, Hai Chau District, Da Nang City, Viet Nam
• Establishment license: 3089/QĐ-BGTVT, dated 10/12/2007
Since its establishment in 1901, Da Nang Port has played a crucial role in export-import activities and the economic development of Da Nang, solidifying its status as the largest seaport in Vietnam's central highlands Over its 120 years of operation, the port has become a key node in both domestic and international supply chains, expanded into agriculturally-based regions, and continuously enhanced its marketing efforts Additionally, Da Nang Port has invested in upgrading its facilities and machinery, further reinforcing its significance in the region's economy.
Da Nang Port operates Tien Sa Seaport and Song Han Terminal, as well as other businesses
On July 24, 2014, Da Nang Port transitioned from a state-owned enterprise to a Da Nang Joint Stock Company, marking a pivotal change in its organizational structure This transformation has enabled the port to attract significant financial resources, positioning it for substantial future growth and enhancing its role as a key player in the business process.
Figure 2-2 Da Nang port's location (Source: https://danangport.com/)
Da Nang Port is committed to ensuring the smooth, rapid, and safe flow of materials, people, and culture, driven by its core values of Honesty, Discipline, Creativity, Professionalism, and Individual Respect This mission reflects the belief that such efforts will foster prosperity in the region.
Da Nang Port is becoming the leading international trade gateway for the country and the Mekong Sub region
- Cargo loading and unloading services
- Services of warehouses and yard keeping and leasing
- Towage, assistance of ships at the port
- Trading in other maritime services
Organizational structure
2.2.1 The chart of organizational structure:
Figure 2-3 Organizational chart of Da Nang port joint stock company
2.2.2 The function of each department:
The Da Nang Port Joint Stock Company is organized into three primary departments, each responsible for distinct missions, all overseen by the General Meeting of Shareholders.
The main controlling departments that manage and decide for activities at Da Nang Port as a whole are:
• General meeting of shareholders: leading the whole company, in charge of discussing, approving, and making decisions for corporate’s issues within jurisdiction
The Administrative Council possesses full authority to represent the firm and is accountable for overall management and business operations, all under the supervision of the General Meeting of Shareholders It is supported by two key departments: the Administration-Secretary and the Internal Audit Committee.
• General manager: carry out and report on the company's business operations under the supervision and guidance of the Administrative council and the General Meeting of Shareholders
• Deputy general manager: oversee, manage, and carry out each business division of the organization following the direction and assignment of the General manager
• Control broad: voted by the General meeting of shareholders, working on behalf of shareholders to control business activities and management
The business department plays a crucial role in analyzing market research, trends, and customer demand to recommend effective marketing strategies Additionally, it manages and supervises business agreements related to the transportation, storage, and retrieval of products at the port, as well as overseeing the import and export processes This department also forecasts the volume of goods produced and addresses any disputes related to these goods.
• Financial accounting department: manage and efficiently employ capital sources, implement, and carry out financial goals, and perform accounting tasks in
21 compliance with legal requirements Create yearly management reports as well as financial reports
The Investment Planning Department is responsible for developing and implementing production and business plans for the Port, coordinating with relevant organizational departments This includes managing development and investment projects, seeking partnerships, and formalizing contracts for economic activities Additionally, the department handles repairs, asset liquidation planning, and oversees data synthesis, analysis, and assessment of company conditions while acquiring, managing, assigning, and safeguarding various business assets.
• Salary organization department: training, recruiting, arranging, and promoting port employees follow retirement pension and social insurance policies
• Construction technological department: proposing and conducting investment projects, construction and guaranteeing for safety and efficiency in technical management at the port
• Engineering technological department: preparing and conducting tasks involved in mechanicals, loading/unloading and loading/unloading equipment Make sure the electrical system runs efficiently, affordably, and safely
• Information technology: establishing, implementing information technological projects for production activities, configure and maintain management software, hardware, and IT infrastructure
• General administrative office department: preparing and implementing tasks related to clerical, archival, emulation,
The customer service center serves as the primary point of contact for all inquiries and feedback regarding port operating services It efficiently receives and processes requests, offers support, guides procedures, and resolves customer complaints To ensure optimal service delivery, the center collaborates with relevant departments and facilitates consultations, procedural advice, and information processing Additionally, it monitors and verifies transactions conducted online through the ePORT system or in person at the counter, fulfilling its core responsibilities effectively.
22 department is to handle import and export paperwork activities for customers, shipping lines, and forwarders
• Logistics service center: providing logistics services, loading and unloading cargoes/ containers; storing; warehouse rental; transportation services; transportation information management; container rental
• Tien Sa Port enterprise: in charge of producing and exploiting, with the ability to actively run Da Nang Joint Stock Company's production activities
In 2022, the maritime sector faced significant challenges, particularly impacting Da Nang Port However, through the dedicated efforts of the Board of Directors and employees, Da Nang Port achieved remarkable performance, surpassing expectations in sales and profit Revenue rose by 10% and profit increased by 13% compared to the same period in 2021.
In 2023, Da Nang port prioritized investments in IT systems, enhancing the income management system and administrative task indicators, including the CATOS software The port also upgraded its ePORT website, implemented an automated smart gate, and digitized ship operation management procedures to streamline operations.
Mr Tran Le Tuan, the General Manager of Da Nang Port Joint Stock Company, reported that the port's cargo throughput in the first nine months of 2023 exceeded 492,000 TEUs, reflecting a nearly 3% increase compared to the same period in 2022.
The business Report below has illustrated the fluctuation in company’s revenue, cost, and profit
Revenue from sales of goods and rendering of
Cost of goods sold and service rendered
Profit after corporate income tax
Table 2-2 Revenue comparison between 2021- 2022 and 2022-2023
(Source: Self-developed) The table has shown an upward trend in the company’s performance during the period from
Between 2021 and 2023, net revenue increased significantly, rising from 1,078,888,885,510 VND in 2021 to 1,196,375,008,642 VND in 2022, and then reaching 1,235,319,352,961 VND in 2023 The growth rate of net revenue from 2022 to 2023 was 3.26%, which is lower than the 10.89% increase observed from 2021 to 2022 This upward trend indicates a consistent growth pattern over the three years.
Da Nang Port has demonstrated substantial growth in net revenue from sales and services, reflecting its effective business strategy aimed at gaining competitive advantages Despite challenges such as market fluctuations, the COVID-19 pandemic, variable weather conditions, high inflation, and rising fuel prices, the port has consistently maintained stable cargo handling performance and a strong market position.
Da Nang Port stands out as the sole seaport in Vietnam to achieve the sustainable business award for seven consecutive years Notably, in 2022 and 2023, it was honored as one of the top ten sustainable businesses in the trade and service sector.
Table 2-3 Financial income comparison between 2021- 2022 and 2022-2023
It also can be seen from the table above, there was an increased tendency in the financial income This number climbed moderately in 2021–2022 by 8,350,452,115 VND (26,09%) and in 2022–2023 by 11,059,910,523VND (27.40%)
2.2.3.2 Company’s related cost and expense between 2021 - 2023:
Table 2-4 Cost of goods sold comparison between 2021- 2022 and 2022-2023
Da Nang Port specializes in a range of services essential for the export and import process, including loading and unloading cargo, managing warehouses and yard space, and offering leasing options The port also provides towage services, ship assistance, water and road transportation, energy supply, repair services, and various other maritime trade activities.
Between 2021 and 2023, the cost of goods sold and services rendered increased from 690,970,765,355 VND to 779,598,605,813 VND, reflecting a growth trend Specifically, in 2022, costs rose by 43,426,440,904 VND (6.28%) compared to 2021, and in 2023, they further increased by 45,201,399,554 VND (6.15%) from the previous year’s figure of 734,397,206,259 VND This rise in costs does not indicate a weakness in the company’s ability to manage expenses; rather, it is influenced by broader socio-economic factors such as the lingering effects of the pandemic, political conflicts, and fluctuating fuel prices, all of which have impacted the cost of goods sold.
Table 2-5 General administrative expenses comparison between 2021- 2022 and 2022-2023
Between 2021 and 2022, Da Nang Port focused on restructuring its organization towards specialization, conducting 22 training sessions for staff to improve productivity This initiative resulted in a 47.02% increase in general and administrative expenses, totaling 43,095,676,536 VND in 2022 compared to 2021 Nevertheless, the shift to digital processes and the training of employees significantly enhanced the effectiveness and efficiency of operations.
Following the COVID-19 outbreak, the economic and political landscape has stabilized, leading to significant improvements in service efficiency and cost reduction Consequently, the general and administrative expenses at the Port in 2023 decreased by 2.51% compared to 2022.
PROFIT AFTER TAX Compared period
Table 2-6 Profit after tax comparison between 2021- 2022 and 2022-2023
The year 2022 has witnessed a sharp turnaround in the figure with the amount leaping from 242,696,495,191 in 2021 to 271,754,310,520 (11.97%) The growth speed was slower in
2023 when the profit after only surging 1.31% from 271,754,310,520 VND to 275,323,834,153 VND
THE FORWARDING PROCESS OF EXPORTED FLAMMABLE
The forwarding process of exported flammable solids products (FCL) at Da Nang
During my internship at Da Nang Port Joint Stock Company, I observed the forwarding process for a full container load shipment of flammable solid products This chapter details the procedures and activities involved in a real shipment where Hung Hiep Huy Logistics exported 25 tons of wood charcoal to Korea using SITC Container Lines Co Ltd as the carrier The shipment was packed in a 40-foot high container, clearly labeled as a hazardous product (Class 4.2, UNN1361) Hung Hiep Huy Logistics opted for the "Deliver container to port" service, completing most steps with support from operation management staff.
No Step content Performance/ Supporter
1 Register to take empty containers from the port Customers/ Carrier and Customer service center
2 Register to take empty containers from the Port Customers
3 Fill in detailed information about the special characteristic of shipments
4 Declare customs clearances information Customers/ Custom office, and
5 Response confirmation for registered order ePORT system and Customer service center
6 Make payment for service fee Customers
7 Deliver exported containers to the port Customers
Figure 3-1 The forwarding process of exported flammable solids products (FCL) at Da
Nang Port Joint Stock Company
3.1.1 Step 01: Customer registers to take empty containers from Da Nang Port
Empty containers for forwarding FCL flammable solids shipments should be picked up at Da Nang Port or another port under two specific circumstances If the pickup occurs at Da Nang Port, the process initiates at step 1; otherwise, it commences at step 2.
After negotiations and the signing of a carriage contract, logistics firms will facilitate the shipping process for their customers and cargo owners utilizing Da Nang Port To secure space on vessels for their shipments, customers must proactively reach out to carriers Upon confirmation, they will receive a Booking note, which acts as a crucial agreement between the consignee and the carrier This document, also known as a storage agreement, is essential for sea exports and includes vital information such as the booking number, vessel name, voyage number, departure and arrival dates, loading and unloading ports, transshipment details, empty container pickup port (dem), VGM cut-off time, shipping instruction cut-off time, and carrier contact information.
Figure 3-2 Example of SITC's Booking note
Figure 3-3 Example of SITC's Booking note
The Empty Release Order, issued by the carrier alongside the Booking Note, enables consignees to collect empty containers from designated ports, typically Da Nang Port This process allows them to transport the containers to their private warehouses for packing and to prepare for customs declaration procedures.
Figure 3-4 Example of MSC's Empty release order
To receive empty containers from Da Nang port, customers must first obtain a Booking note and Empty release order from carriers They will then register on the ePORT website, where a packing list will be displayed, including details such as Booking number, Container number, cargo owner, and a PDF of the Booking note Customers need to accurately fill in these fields, upload the Booking note files on ePORT, and click “Request for empty containers” after verifying their information Once the order is approved, customers can send their vehicles to pick up the registered empty containers from Da Nang port.
Empty containers for transporting dangerous goods, such as gas and liquids, typically come in sizes of 22 TO, 42 TO, and 45 TO, depending on the classification of the hazardous materials Specifically for flammable solids like wood charcoal, while it does not ignite spontaneously, it can catch fire when exposed to an ignition source, thus requiring careful storage in general container types To ensure safety during transportation and storage, additional protective measures must be implemented, including temperature and humidity control and maintaining a safe distance from heat sources and other flammable materials This is essential for the safety of customers, carriers, employees, and the environment at the port The booking note will specify the types of empty containers required, as seen in shipment SITU4672873 from Hung Hiep Huy Logistics, which indicates Da Nang Port for container pick-up They will utilize the ePORT system to request empty containers suitable for wood charcoal and attach their booking note on the website, allowing customers to send drivers to collect the containers for transport to their warehouses.
3.1.2 Step 02: Customers register to deliver containers to Da Nang Port
After completing the shipment packing, customers can use the ePORT system to send their order for container delivery to the port, including a Booking note and essential details such as Booking number, container number, size, type, shipper name, vessel name, voyage number, anticipated ship arrival date, loading and unloading ports, and cargo weight To enhance collaboration among Da Nang port, carriers, and logistics companies, it is recommended that carriers provide an Excel list in advance containing vessel names, container numbers, boat numbers, and departure times This information can be updated by customer service staff in the CATOS app, simplifying the order registration process for customers on the ePORT system and aiding OM staff in data retrieval in case of errors Upon successful declaration by the customer, the system will automatically display the applicable storage fees, which must be paid for the shipment, while also notifying the port.
The OM department is responsible for reviewing the disclosed details and comparing them with the information in the accompanying Booking note If discrepancies arise between the Booking data and the submitted details, OM will check Outlook for any updates from the carrier or clients In the absence of new information, OM will reach out to the customer via Zalo to request confirmation through Outlook, ensuring accurate system updates Generally, updates from Outlook serve as the final confirmation for shipments.
Figure 3-5 ePORT screen for registering delivery container to port order
3.1.3 Step 03: Customers fill in detailed information about the special characteristic of shipments:
For FCL shipments with dangerous products, customers must enter detailed and completed information about the shipment for further inspection and preparation
When dealing with hazardous containers, it is essential to provide specific details such as the container number, size, IMO and UNNO index, product name, and packaging specifications The characteristics of containers transporting hazardous materials can significantly impact the safety of the materials, workers, and the general public at Da Nang port Therefore, a thorough examination of the goods information and packaging requirements is crucial for ensuring safety and security.
In short, if a customer wants to register to deliver a dangerous container for exporting at
To ensure the safety of all parties involved and facilitate a smooth export process at Da Nang port, it is essential to prepare all necessary documents, technical measures, and skills Compliance with legal regulations regarding carried commodities is crucial The OM, gate-in-charge, and CM staff must meticulously verify the information and authenticity of each dispatched shipment In the event of any issues, it is imperative to promptly inform port customers and shipping companies to prevent errors during the storage and export of these unique cargoes.
For the shipment of wood charcoal, when customer register order “Delivery containers for port” as container no is SITU 4672873, these following information needs to be detail declared:
Cargo owner: ADP Ltd Company
After completing the general information, it's essential to provide specific details regarding the shipment's unique characteristics, particularly since it contains wood charcoal, which is classified as a dangerous product under the UN Model Regulations.
UNNO: UN 1361: CARBON, animal, or vegetable origin
Packing instruction: Packing group II for substances presenting medium danger (Acd to
UN packing group) and label “accept IMO class 4.2 UNN 1361
Figure 3-6 Dangerous label for Class 4.2, UNN 1361
Figure 3-7 ePORT screen for details declaration of dangerous products
3.1.4 Step 04: Customer declare customs clearances information:
After completing the packaging and order registration on the ePORT system, customers must prepare the necessary documents for export customs declaration To proceed, they must successfully register the "Deliver container to port" order Once they receive confirmation of the successful delivery order registration, customers can select their shipment list to initiate the customs declaration on the ePORT system By entering the declaration number, a detailed information entry screen will appear To verify the declaration information, customers are required to input the Booking number and Container number, followed by clicking "Check."
The ePORT system streamlines the customs declaration process by automatically connecting and transferring information to ACCIS Once a notification is sent regarding the completion and approval of all proclaimed containers designated as green line, customers must verify the approval status of each container to ensure compliance.
Figure 3-9 Approved custom declaration notification
The customs declaration for hazardous products like wood charcoal follows the same procedures as general cargo For cargo SITU46728733 destined for Incheon, Korea, it is crucial to include essential export documentation, including a packing list, booking note, and invoice, to ensure compliance Both the Vietnamese and Korean governments require adequate documentation that meets coal quality standards outlined in Appendix I of Circular 15/2013/TT-BCT, along with proof of legal origin as mandated by relevant regulations.
No 14/2013/TT-BCT, plant quarantine, and a few other documents
If a response is unsuccessful or pending for an extended period, OM staff will utilize the admin screen to assist by selecting "Support for making orders" and choosing Customs clearance They must meticulously review the customer's declared information, such as Booking and container numbers, and compare it with the data in the CATOS or ACCIS systems After this review, OM staff will request any necessary corrections from the customer and reprocess the declaration using "Customs synchronization" to update the customer If the order still cannot be reprocessed, OM staff will escalate the issue by selecting “Move to second level” to involve higher-level staff In cases where ACCIS fails, support staff will manually synchronize by checking the customs clearance status, confirming it, and entering the tax code.
RECOMMENDATIONS TO IMPROVE THE FORWARDING
FLAMMABLE SOLIDS PRODUCTS (FCL) AT DA NANG
To enhance the efficiency and effectiveness of the investigation process at the Customer Service center and Da Nang port, several key suggestions have been identified based on careful observation and analysis of current operations.
While Da Nang port effectively utilizes technology in its operations, there are still notable drawbacks related to system errors To mitigate these issues, it is essential for the port to swiftly update and enhance its automation technologies, including the implementation of EDI applications to ensure accurate information transfer between systems Additionally, regular maintenance and updates of facilities such as internet connections and computers are crucial for enabling staff to perform their tasks efficiently and for assisting customers in navigating procedures without unnecessary delays caused by IT troubleshooting.
To minimize costs, Da Nang port is implementing automation technology, such as sending OTP codes via the Zalo app instead of traditional phone numbers, as currently utilized by ePORT Maintaining systems, internet lines, and employee computers on a fixed schedule is essential for ensuring quality and reducing unexpected repair costs Additionally, the multitasking capabilities of staff across various teams are vital for cost reduction, as their professional and accurate skills help minimize errors in the operational process Furthermore, Da Nang port should consider programs that enhance employee knowledge and skills in customer service, supply chain management, language proficiency, and other relevant tasks to improve overall efficiency.
The era of global market integration has provided Vietnam with opportunities to enhance its economy on both domestic and international fronts As trade cooperation with Southeast Asian, Asian, and European nations increases, Vietnam is solidifying its presence in the global market, particularly through the vital trade route of the Bien Dong (Eastern Sea) Da Nang has emerged as a key trading port within the Central-Central Highlands supply chain, significantly improving its service quality over the years The port has streamlined its processes for handling flammable solid products through the implementation of advanced technologies like ePORT and CATOS systems Furthermore, Da Nang port diligently adheres to regulations and procedures for exporting special cargo, ensuring accurate shipment information, product quality, and the safety of all personnel involved in the exporting process.
During the period of time, I worked as an intern at Da Nang port - Customer Service Center,
During my internship at Da Nang port, I analyzed the forwarding process for flammable solids products This report details the evaluation of this process, highlighting both its strengths and weaknesses Additionally, I provide recommendations for the company to improve the quality and efficiency of its forwarding operations, specifically for shipments with unique physical and chemical properties, particularly focusing on flammable solids.
What are Dangerous Goods? (Federal Aviation Administration) From https://www.faa.gov/hazmat/what_is_hazmat.
Australian Code for the Transport of Dangerous Goods (n.d.) From National Transport
Commission: https://www.ntc.gov.au/codes-and-guidelines/australian-dangerous-goods- code
Bill R Leonard, J (n.d.) Environment, Health and Safety From Cornell University: https://ehs.cornell.edu/shipping-and-transportation/hazardous-materials-shipping-dot
Cảng Đà Nẵng cần tập trung mọi nguồn lực cho dự án đầu tư Cảng Liên Chiểu (2023)
Cảng Đà Nẵng cần tập trung nguồn lực cho dự án đầu tư Cảng Liên Chiểu, nhằm nâng cao khả năng tiếp nhận hàng hóa và phát triển kinh tế khu vực Bộ Giao thông và Vận tải nhấn mạnh tầm quan trọng của việc đầu tư vào cơ sở hạ tầng cảng biển để đáp ứng nhu cầu ngày càng tăng của thị trường Dự án này không chỉ góp phần vào sự phát triển bền vững mà còn tạo điều kiện thuận lợi cho việc thu hút đầu tư trong tương lai.
Cảng Đà Nẵng rút ngắn thời gian giao nhận hàng hóa xuất nhập khẩu đã thông quan
(2016) From Bộ Tài Chính: https://mof.gov.vn/webcenter/portal/btcvn/pages_r/l/tin-bo- tai-chinh?dDocName=MOFUCM091033 company, D N (2023) Da Nang Port Financial Report
DNP (2021) Da Nang Port Financial Report https://danangport.com/wp- content/uploads/2022/04/DNP-FS-Q1-2022-En.pdf
DNP (2021) Da Nang Port Financial Report https://danangport.com/wp- content/uploads/2022/04/DNP-FS-2021-Audited-En.pdf
DNP (2022) Da Nang Port Financial Report https://danangport.com/wp- content/uploads/2022/04/DNP-FS-Q1-2022-En.pdf
DNP (2023) Da Nang Port Financial Report https://danangport.com/wp- content/uploads/2024/04/DNP-FS-2023-Audited-En.pdf
In September 2023, cargo throughput at Da Nang Port experienced significant growth, reflecting the port's increasing role in regional trade and logistics This surge in activity highlights the port's strategic importance for businesses looking to enhance their supply chain efficiency As a key player in Vietnam's maritime industry, Da Nang Port continues to facilitate economic development and attract investment opportunities.
Montwiłł, A (October 2014) The Role of Seaports as Logistics Centers in the Modelling of the Sustainable System for Distribution of Goods in Urban Areas Research gate,
Nghị định quy định danh mục hàng hóa nguy hiểm và việc vận chuyển hàng hóa nguy hiểm bằng phương tiện giao thông cơ giới đường bộ, cũng như vận chuyển hàng hóa nguy hiểm trên đường thủy nội địa, được ban hành vào năm 2020 Nghị định này nhằm đảm bảo an toàn trong quá trình vận chuyển, quản lý các loại hàng hóa có nguy cơ cao, từ đó bảo vệ sức khỏe cộng đồng và môi trường Các quy định cụ thể về việc phân loại, đóng gói và vận chuyển hàng hóa nguy hiểm sẽ giúp giảm thiểu rủi ro và nâng cao hiệu quả quản lý.
Thư viện Pháp Luật: 42/2020/NĐ-CP
Quy định mới về vận chuyển hàng hóa nguy hiểm được Tổng cục Quản lý thị trường công bố nhằm đảm bảo an toàn và hiệu quả trong quá trình vận chuyển Các yêu cầu mới này bao gồm việc phân loại hàng hóa, trang bị phương tiện vận chuyển phù hợp và tuân thủ quy trình an toàn Người vận chuyển cần nắm rõ các quy định để tránh vi phạm và đảm bảo an toàn cho cộng đồng Thông tin chi tiết có thể tham khảo tại trang web của Tổng cục Quản lý thị trường.
United Nation Reccommendations on transport of dangerous goods (2019) https://unece.org/fileadmin/DAM/trans/danger/publi/unrec/rev21/ST-SG-AC10-
1r21e_Vol1_WEB.pdf From United Nation : https://unece.org/fileadmin/DAM/trans/danger/publi/unrec/rev21/ST-SG-AC10-
Weiss, D J (March 2009) Criteria for performance evaluation Judgment and Decision Making, Vol 4, No 2
Hazardous materials descriptions and proper shipping names
Label Codes Alkali metal alcoholates, self-heating, corrosive, n.o.s 4.2 UN3206 II 4.2, 8
Alkaline earth metal alcoholates, n.o.s 4.2 UN3205 II 4.2 Aluminum borohydride or Aluminum borohydride in devices 4.2 UN2870 I
4.2, 4.3 Articles containing a substance liable to spontaneous combustion, n.o.s 4.2 UN3542 4.2
Barium alloys, pyrophoric 4.2 UN1854 I 4.2 tert-Butyl hypochlorite 4.2 UN3255 I 4.2, 8
Calcium dithionite or Calcium hydrosulfite 4.2 UN1923 II 4.2
Calcium, pyrophoric or Calcium alloys, pyrophoric 4.2 UN1855 I 4.2
Carbon, animal, or vegetable origin 4.2 UN1361 II 4.2
Charcoal briquettes, shell, screenings, wood, etc 4.2 NA1361 III 4.2
Cotton waste, oily 4.2 UN1364 III 4.2
Ferrous metal borings, shavings, turnings, or cuttings are classified as materials prone to self-heating, designated under UN2793 with a packing group of III Additionally, animal or vegetable fibers that are burnt, wet, or damp fall under the classification of UN1372, also with a packing group of III.
Fibers or Fabrics, animal or vegetable or
Synthetic, n.o.s with animal or vegetable oil 4.2 UN1373 III 4.2 Fish meal, unestablished or Fish scrap, unstabilized 4.2 UN1374 II 4.2
Iron oxide, spent, or Iron sponge, spent obtained from coal gas purification 4.2 UN1376 III 4.2
Maneb or Maneb preparations with not less than
Metal catalyst, wetted with a visible excess of liquid 4.2 UN1378 II 4.2
Metal powder, self-heating, n.o.s 4.2 UN3189 II 4.2 p-Nitroso dimethylaniline 4.2 UN1369 II 4.2
Organic pigments, self-heating 4.2 UN3313 II 4.2
Organometallic substance, liquid, pyrophoric 4.2 UN3392 I 4.2 Organometallic substance, liquid, pyrophoric, water-reactive 4.2 UN3394 I
4.2, 4.3 Organometallic substance, solid, pyrophoric 4.2 UN3391 I 4.2
Organometallic substance, solid, pyrophoric, water-reactive 4.2 UN3393 I
4.2, 4.3 Organometallic substance, solid, self-heating 4.2 UN3400 II 4.2 Paper, unsaturated oil treated incompletely dried
(including carbon paper) 4.2 UN1379 III 4.2
9-Phosphabicyclononanes or Cyclooctadiene phosphines 4.2 UN2940 II 4.2
Phosphorus, white dry or Phosphorus, white, under water or Phosphorus white, in solution or
Phosphorus, yellow dry or Phosphorus, yellow, under water or Phosphorus, yellow, in solution 4.2 UN1381 I
4.2, 6.1 Plastics, nitrocellulose-based, self-heating, n.o.s 4.2 UN2006 III 4.2 Potassium dithionite or Potassium hydrosulfite 4.2 UN1929 II 4.2 Potassium sulfide, anhydrous or Potassium sulfide with less than 30 percent water of crystallization 4.2 UN1382 II 4.2
Pyrophoric liquid, inorganic, n.o.s 4.2 UN3194 I 4.2 Pyrophoric liquids, organic, n.o.s 4.2 UN2845 I 4.2 Pyrophoric metals, n.o.s., or Pyrophoric alloys, n.o.s 4.2 UN1383 I 4.2
Pyrophoric solid, inorganic, n.o.s 4.2 UN3200 I 4.2 Pyrophoric solids, organic, n.o.s 4.2 UN2846 I 4.2
Seed cake, derived from vegetable oil solvent extractions and expelled seeds, contains a maximum of 10 percent oil If the moisture content exceeds 11 percent, the combined total of oil and moisture must not exceed 20 percent This product is classified under 4.2 UN1386 III.
Seed cake with more than 1.5 percent oil and not more than 11 percent moisture 4.2 UN1386 III None
Seed cake must contain no more than 1.5% oil and 11% moisture, classified under UN2217 with a hazard level of III Additionally, self-heating liquids are categorized as corrosive and can be inorganic (UN3188, II) or organic (UN3185, II) Other classifications include self-heating inorganic liquids (UN3186, II) and self-heating organic liquids (UN3183, II), both marked with hazard code 4.2.
Self-heating liquid, toxic, inorganic, n.o.s 4.2 UN3187 II
Self-heating liquid, toxic, organic, n.o.s 4.2 UN3184 II
4.2, 6.1 Self-heating solid, corrosive, inorganic, n.o.s 4.2 UN3192 II 4.2, 8 Self-heating solid, corrosive, organic, n.o.s 4.2 UN3126 II 4.2, 8 Self-heating solid, inorganic, n.o.s 4.2 UN3190 II 4.2 Self-heating solid, organic, n.o.s 4.2 UN3088 II 4.2
Self-heating solid, oxidizing, n.o.s 4.2 UN3127
Self-heating solid, toxic, inorganic, n.o.s 4.2 UN3191 II
Self-heating solid, toxic, organic, n.o.s 4.2 UN3128 II
4.2, 6.1 Sodium dithionite or Sodium hydrosulfite 4.2 UN1384 II 4.2 Sodium hydrosulfide, with less than 25 percent water of crystallization 4.2 UN2318 II 4.2
Sodium sulfide, anhydrous or Sodium sulfide with less than 30 percent water of crystallization 4.2 UN1385 II 4.2
Textile waste, wet 4.2 UN1857 III 4.2
Titanium trichloride, pyrophoric or Titanium trichloride mixtures, pyrophoric 4.2 UN2441 I 4.2, 8
Wool waste, wet 4.2 UN1387 III 4.2
Zirconium, dry, finished sheets, strip or coiled wire 4.2 UN2009 III 4.2
Table Appendix-1 Packing group classification for subclass 4.2